Cost-Benefit Analysis for the Concentrating Solar Power in China

Concentrating solar power (CSP) is of great significance in achieving the goals of renewable energy planning and carbon emission reduction. Chinese government pays importance to the development of CSP in recent years. In 2016, the first CSP demonstration projects of China were approved formally. In view of the important impact of the cost-benefit on the investment decisions and policy making, the paper adopted the static payback period (SP), net present value (NPV), net present value rate (NPVR) and internal rate of return (IRR) as measure indices to analyze and discuss the cost-benefit of CSP demonstration plants, based on different angles. The results show that: (1) The SP of CSP systems is relatively longer, due to high initial investment; but the cost-benefit of CSP demonstration plants as a whole is better, because of nice expected incomes. (2) Vast majority of CSP projects could gain excess returns, on basis of meeting the profitability required by the benchmark yield of 10%. (3) The cost-benefit of solar tower CSP technology, with average IRR of 12.33%, is better than that of parabolic trough CSP technology with average IRR of 11.72% and linear Fresnel CSP technology with average IRR of 11.43%. (4) The annual electricity production and initial costs have significant impacts on the cost-benefit of CSP systems; the effects of operation and maintenance costs and interest rate on the cost-benefit of CSP systems are relatively smaller, but cannot be ignored. The study on the cost-benefit of CSP demonstration plants could provide some important scientific basis for the investment decisions and policy making of CSP industry in China.